Under the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. Section 7001, any transactions affecting interstate or foreign commerce, a contract or other record relating to the transaction shall not be denied legal effect merely because it is in electronic form. For example, a sender’s name on an e-mail equates to a handwritten signature, thereby any e-mail messages regarding purchase orders that contain the typed name of the sender are sufficient to make the agreement valid.

Accordingly, any standard form electronic contracts, commonly known as “click-wrap” are valid and legally enforceable. “A click-wrap license presents the user with a message on his or her computer screen, requiring that the user manifest his or her assent to the terms of the license agreement by clicking on an icon.” Specht, 150 F. Supp. 2d at 593-94.

Although certain consumers may not understand the legal effect of their action in clicking on an icon marked “I accept,” courts have rejected arguments that the resulting click-wrap contracts should be declared void, unless those consumers can prove fraud or unconscionability. In the absence of fraud, “the user’s failure to read, carefully consider, or otherwise recognize the binding effect of clicking ‘I agree’ will not preclude the court from finding assent to the terms.” The Judicial Acceptance of click-wrap, 22 Berkeley Tech. L.J. 577, 579 (2007).

Thus, any contracting party has a duty to read the agreement before he or she clicks “I accept,” regardless of whether it is in electronic format without a handwritten signature.

In California and Texas, covenants not to compete are generally unenforceable, while non competition agreements are enforceable in the majority of states.

In Washington, the law related to covenants not to compete has changed since November 2004, when the Washington State Supreme Court concluded, in Labriola vs. Pollard Inc., that a non-compete agreement entered into after employment has commenced is valid only when there is independent consideration given at the time the agreement is reached.

Thus, it is critical for employers wishing to protect their business with non-competes in Washington to give their employees independent consideration in a reasonable manner to the extent that one party performs some additional obligation while the other party gives something up. It is also important to be aware that a non-compete agreement entered into before employment has commenced is more likely to be found reasonable as the employer gives an employee the new employment opportunity and wages while the employee accepts a restriction on his or her activities in return.

井上奈緒子

Naoko Inoue Shatz is a U.S. lawyer who has extensive business experience in Japan, and she has a wide range of practice experience involving cross border matters and legal disputes between U.S. and Japan. Her dedication and responsiveness in addition to her experience has often helped corporate clients quickly uncover challenging issues and develop a sound business relationship. 井上奈緒子は日本でビジネスの経験を持つ米国の日本人弁護士で、アメリカと日本の2国間にかかわる一般法務から法的紛争にわたって幅広い経験を持ちます。さらに専心さと対応力に関しても多くのクライアントから評価を得ており、国際商業取引業務においてクライアントとは確実な関係を築きあげてきています。Read More

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